DETERMINANTS OF CUSTOMER SATISFACTION IN RETAIL BANKNG AT DUNKWA, GHANA

ABSTRACT
The banking sector in Ghana has undergone tremendous change over the years as a result of keen competition among the players. Banks are constantly adopting dynamic customer service practices and strategies in order to retain customers. Intense competition has led to decrease in firm’s profit, switching customer behaviour and spreading negative word of mouth if services do not meet client’s expectation resulting in the need to investigate customer satisfaction in retail banking within Dunkwa Catchment area. The study focused on assessing determinants of customer satisfaction in retail banking at Dunkwa, Ghana. The survey was conducted on a total of 500 respondents out of which 406 responses were received representing 81.2% response rate. The study collected data using questionnaires. The study adopted convenience and purposive sampling technique in selecting customers. Statistical Package for Social Sciences software was used to run the descriptive statistics. Regression analysis was used to estimate the relationships among variables. Findings revealed that, employees at the Retail Banking are always ready to response quickly to customers’ needs and further assist customers with any challenges they encounter during the banking hours. The findings further revealed that high services quality and standards are very crucial to them and therefore prepared to pay any amount to receive or enjoy the quality services. Competitive products are most often than not considered to be of high quality with increased performance. The study records a positive impact of sympathetic staffs and operational hours on customer satisfaction. Sympathetic staffs and operational hours are statistically significant and are making a unique contribution to the prediction of customer satisfaction. The study recommended improvement on the banks system of service delivery to its customers, most especially the customer service practices, constantly engagement of both the internal and external customers of the bank in order to achieve optimum satisfaction as well as other stakeholders in decision making so as to identify their pressing needs.


CHAPTER 1
INTRODUCTION
1.1 Background of the Study
One of the important theoretical issues for most consumer researchers and marketers is Customer satisfaction. To be at the highest peak of success in this modern world of business is to give significance to customer satisfaction. Customer satisfaction has become one of the corporate goals as most firms strive for quality services to match their quantity on demands. For some years now, Ghana’s banking industry have gone beyond transactional to customer relationship management techniques with the aim of attracting and nourishing long-term dealings with their clients. According to Owusu-Frimpong (2008) and Blankson (2009), in spite of these strategic implementations, it is difficult to accomplish customer loyalty due to forces including the introduction of information technology, globalization, deregulation and continual changes to state laws which have brought extreme competition to the banking sector.

According to most research scholars, in some cases where a retail bank tries to increase its client retention rates by 5% also increases its gains upwards to 85% (Choudhury, 2015). Enhancing customer satisfaction, and its retention rates, can come from a variety of services performed by the bank. Empirical research suggests that massive advantages in customer satisfaction are likely to be derived from enhancements in service quality, service features and adequate handling of client complaints (Ashill et al) Firms including banks that have a loyal customer base established, have their rewards well documented. (Ali & Raza,2015). Basically, they bring to light the understanding that increased customer loyalty reduces costs of servicing a firm’s clientele, marketing expenses and also improves businesses from the established client base at improved profit. These profits are mostly found in the retail banking sector (Consuegra et al). A retail bank decides to minimise its services cost by retaining customers that is accounts do not have to be opened and closed, and credit ratings do not have to be established. A retail bank must gain the knowledge of the financial matters and essentials of its customers and thereby allowing operative and effective goals as a way of increasing loyalty gains and also the prospect to sell existing and new products and services well to customers.

This report is set to unravel the determinants of customer satisfaction in retail banking especially in the remote areas where they are less privilege of infrastructure and other modern facilities to enhance their way of life. The remote area for this research was Dunkwa-on-Offin in the Central Region of Ghana where I work. Prior to that, it outlines a set of secondary literature which will be used to critically analyse the results for a more appropriate and coherent discussion of the findings (result). The sample participants (n=120) solely focused on a number of retail banking clients including that of commercial banks, savings and loans as well as rural banking clients in other to achieve the aim and purpose of this research. This is a quantitative research and it will utilizes the use of an ethnographic approach which includes interviews conducted with each recruit by various means, mainly a face-to-face mode within a 20 to 30 days period. Such approach provided a more voluntary way for unveiling the important of merit of each participant, hence providing a more detail and in-depth results and findings (Hesse-Biber, 2010). Particularly, this research aims to investigate the role of service quality, service features, service problems and situational factors as indicators of customer satisfaction and future intentions with their main financial institution. The results aims at provide retail bank managers with a better understanding of the drivers of customer satisfaction in this service industry.


1.2 Problem Statement
Despites Gwinner et al. (1998) calls for more research in the areas of customer perceptions and satisfactions, there are but a small number of empirical studies in retail banking including the works of Colgate et al. (2005) and Consuegra et al. (2006). Currently, with the increased number of retail and commercial banks in the country and a high competitive market sector, most of these new banks enter into the market as a result of acquisition from nonperforming banks with moderate asset range especially in the case of Amalgamated bank been acquired by Bank of Africa. Many questions are being raised as to what causes the bad performance and folding of these banks. As previously mentioned, the significance of customer satisfaction and customer retention in strategic development for a market oriented and customer focused firm cannot be underestimated. If a firm, in this case a bank, decides to adopt a more customer oriented approach in its business it is believed to succeed progressively and not think of folding. In this case, many of these banks in the country end up establishing branches in urban and semi-unban communities and not focusing on most strategic rural areas such as Dunkwa, a gold mining town. These banks can provide reasons such as high cost effectiveness, longer periods of break-even as well as less patronising of other banking services and products as reasons as to such decisions but technically ignore to set their strategic operations around the needs of their clients in such remote areas. In order to meet such needs, research of this nature needs to be conducted.


1.3 Research Objectives
In order to achieve success in this study, the following objectives need to be achieved

i.            Examine the factors and their relative importance that influence client’s decisions to switch among banks in Dunkwa-on-Offin.

ii.             Identify key factors which lead to high customer satisfaction and the ways in which they could be improved in the retail banking in Dunkwa-on-Offin.

iii.             Evaluate the effect of customer service practices in retail banking on customer satisfaction

1.4 Research Questions
The following questions must be answered and critically analysed in order to achieve the main objectives of this research.

i.            What are the customer satisfaction determinants that influence client’s decision in maintaining their banks without switching among them in Dunkwa?

ii.             Which key factors contribute to high customer satisfactions in retail banking and how could they be improved?

iii.             What are the effects of customer service practices in retail banking on customer satisfaction?

1.5 Significance of the Research
The significance of this study lies on relationship marketing, quality of services and consumer satisfaction as the essential fundamentals for the accomplishment of financial businesses facing increasing competitive and gradual market dynamics. Despite the fact that previous researches have delivered prior knowledge in relation to the nature and significance of banking relationships from a customer’s point of view (Narteh, 2013), there are some vital questions which still remain unanswered. In this day and age, most financial institutions belief that a meticulous customer service will serve to be more significant to consumer satisfaction rather than lower prices in areas of businesses where there is a direct relationship between companies and their clients in particular. The marketing literature has recognized the importance of developing and maintaining such enduring relationships with customers of service (Narteh, 2013). Also, a review of literature has revealed that studies focusing on relationship marketing, service and satisfaction already exist.

Nonetheless, there is an essential amount of lack of practical and empirical works analysing the actual consequences for individual consumers of maintaining long-term relationships with service providers. In addition, a review of the literature has also shown that there are only a few studies which have dealt with business efforts to establish stable and long-lasting relationships with consumers, as well as with the connection between relational benefits and customer satisfaction which regular customers enjoy. Despite having a lot of research been carried out on the determinants of customer satisfaction in retail banking and how companies can use them to influence consumer satisfaction this study also contribute immensely towards literature for customer satisfaction. As important as this study is, it will contribute to both theory and practice.

These can be seen from the following:
Firstly, the research will help Banks operating in Dunkwa-on-Offinin improve their customer satisfaction. Secondly, this research will serve as a guide for potential entrepreneur and organizations that want to enter the banking to know the value of determinants of consumer satisfaction.

Thirdly, it will be relevant for academic purposes. The study will serve as a base for further research for students, consultants, researchers and others who are interested in studying similar topic. It will also serve as an academic reference in marketing and management disciplines.

Finally, it is more significant because the world is going towards the global competition and businesses try to understand the determinants of customer satisfaction in retail banking on different variables like cost, cycle time, service, and quality. By understanding determinants of customer satisfaction, organizations would re-direct their activities towards achieving their objectives in a meaningful manner.

1.6 Scope of the Study
The focus of the study is on determinants of customer satisfaction in Retail Banking: A Quantitative perspective at Dunkwa-on-Offin, Ghana. The research was limited to residents of Dunkwa-on-Offin, Central Region of Ghana.

1.7 Overview of Research Methodology
The population of this study comprises of residents of Dunkwa-on-Offin within the Central Region of Ghana. For the purpose of this study, 500 customers were selected from Dunkwa-on-Offin. The study will rely on primary sources of data. Data was collected from respondents through administering of questionnaires. The study adopted convenience sampling method to select  customers. Descriptive   analyses   including   regression   analysis,   mean   and  standard deviation and simple percentage were used in analyzing the data which was presented in tables and charts.

1.8 Limitation of the Study
Some of the questionnaires were not received; 500 questionnaires were distributed but in all 406 questionnaires were collected. Some of the respondents were not willing to participate to respond to the questionnaires. There was difficulty in gaining the exact population of the residents of Dunkwa and its environs.

1.9 Organisation of the Study
The  study   is   divided  into   five   (5)   chapters.   Chapter   One   captures   the  background   and introduction  of  the  study,  problem  statement,  objectives  of  the  study,  research  questions, significant of the study, summary of research methodology, scope of the study, limitation of the study and organization of the study. Chapter  Two reviews existing literature on marketing channels   and   consumer   satisfaction.   Chapter   Three   discusses   the   methodology   used to accomplish the study. Chapter Four presents research analysis, findings and discussion. Chapter Five looks at the summary of findings, recommendations and conclusion of the study.

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Item Type: Ghanaian Project Material  |  Attribute: 66 pages  |  Chapters: 1-5
Format: MS Word  |  Price: GH50  |  Delivery: Within 30Mins.
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